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Telecom Order CRTC 98-486

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1. The Network Planning Sub-Group (NPSG) of the CRTC Interconnection Steering Committee (CISC) initiated a dispute related to transiting and asked the Commission to address a number of questions. The Master Agreements Sub-Group also raised a related dispute.

"A [Local Exchange Carrier] LEC transits traffic when it receives the traffic from one carrier and switches it to another. Typically, the [Incumbent Local Exchange Carrier] ILEC would switch traffic from one [Competitive Local Exchange Carrier] CLEC to another CLEC, or from a CLEC to an [interexchange] IX carrier or a [wireless service provider] WSP that is not a CLEC."

4. Paragraph 98 of Decision 97-8 states:

"The Commission is nonetheless of the view that, in the early stages of competition, mandatory provision of transiting would accelerate entry into the local exchange market by removing the burden on CLECs of having to provide trunks between themselves and every other CLEC, WSP and IX carriers. Thus, for reasons similar to those set out above in the discussion of local loop treatment in urban areas, the Commission directs ILECs to unbundle the CLEC-to-CLEC, CLEC-to-WSP and CLEC-to-IX carrier transiting function and to provide, for a period of five years from the date of this Decision, transiting services at rates based on the same principles as established in this Decision for essential services."

5. Paragraph 99 of Decision 97-8 states:

"Given the range of potential transiting arrangements, the Commission will request the CISC to make recommendations as to what arrangements are appropriate. The ILECs will then be required to file transiting tariffs for the arrangements approved by the Commission on the basis set out above."

I. Definition of Bill-and-Keep Traffic

6. One of the issues that is common to many of the transiting disputes addressed in this Decision is the definition of bill-and-keep traffic.

7. The competitors were generally of the view that once traffic is handed over to a carrier, the carrier should be obliged to handle the traffic as though it was its own. In the context of transiting, this would mean that the LEC providing the transiting service would have to route all traffic to other LECs over its bill-and-keep shared-cost trunks.

8. Stentor was of the view that only local traffic between a pair of interconnected CLECs should be carried on the bill-and-keep trunks. Transit service traffic should be carried on separate trunks.

9. In paragraph 63 of Decision 97-8, the Commission stated:

"In light of the above, the Commission concludes that mandating the bill and keep approach would be in the public interest at this time for traffic that is interchanged between and terminated within the same exchange."

10. The finding was made in the context of the exchange of traffic by carriers within an exchange and the compensation for the termination of local traffic.

11. The Commission therefore considers that the bill-and-keep approach it mandated in Decision 97-8 applies to traffic between a pair of LECs that originates and terminates in the exchange (local traffic) in which the LECs are directly interconnected. Where a transiting arrangement is used, the traffic delivered by the originating LEC to the transiting LEC and then transited to the terminating LEC is not delivered on a bill-and-keep basis; rather the originating LEC pays the transiting LEC to deliver traffic to the terminating LEC.

12. This issue concerns whether Decision 97-8 requires that ILECs provide a transiting service only for the exchange of traffic between a pair of CLECs' Points of Interconnection (POIs) located within one exchange or whether ILECs must also transit traffic between the POIs of a pair of CLECs when the POIs are located in two different ILEC exchanges, and the two ILEC exchanges are within a single EAS/EFRC area.

13. The competitors were of the view that the transiting service should include the capability of transiting between ILEC exchanges where there is EAS/EFRC.

14. Although they did not believe that EAS/EFRC transiting was mandated by Decision 97-8, with the exception of TCI, the Stentor companies agreed to define their transiting service to include this capability.

15. The Commission is of the view that it would be difficult for CLECs to implement free calling of the type provided by the ILECs without EAS/EFRC transiting. The most efficient means by which a number of CLECs could provide EAS/EFRC would be through the use of a tandem architecture such as the one that can be provided via the ILEC transiting service.

16. The Commission finds that EAS/EFRC transiting is within the scope of transiting services that the ILECs are required to provide pursuant to paragraph 98 of Decision
97-8.

III. Transiting Service - Inclusion of Trunks and Responsibility for the Cost of the Transiting Arrangement

17. This issue concerns whether the CLEC-to-CLEC transiting service to be provided by the ILECs should include the provision of the necessary trunks between the CLECs and the ILEC or whether it should be limited to the switching capability required, and which carrier is responsible for the cost of the required trunks.

18. The competitors were of the view that transiting traffic should be carried on the same trunk group as bill-and-keep traffic. The competitors stated that it would be both inefficient and technically unnecessary for transiting traffic to be carried over separate trunk groups and that the ILEC transiting rate can be developed to include compensation for the carriage (as well as the processing and switching) of transiting traffic.

19. Stentor noted that transiting is a tariffed service and that it is up to the party requesting the service to deliver its traffic to the ILEC POI. In Stentor's view, it is highly unlikely that competitive alternatives to the transiting services would emerge if the Stentor companies were mandated to subsidize the cost of the trunks utilized by CLECs. With regard to trunks to the terminating CLEC, Stentor stated that the routing will be based on considerations of network efficiency; in some companies this traffic will be carried on bill-and-keep trunks.

20. Decision 97-8 requires that each pair of LECs provide trunking between themselves to exchange local traffic. These interconnecting trunks are for the exchange of local traffic on a bill-and-keep basis and their costs are to be shared. The Commission considers that the transiting service provided by an ILEC essentially replaces the direct trunking between a pair of CLECs.

21. Accordingly, the Commission finds that ILECs' transiting tariffs must include an option for the provision of the trunking required from the originating CLEC and trunking to the terminating CLEC.

22. As noted above, bill-and-keep only applies to local traffic exchanged directly between a pair of LECs. From the perspective of the transiting service provider, transit traffic is not considered to be traffic that is terminated on a bill-and-keep arrangement or carried on shared-cost trunks. Therefore, the CLEC subscribing to the transiting service is responsible for the cost of the trunks. It follows that if the bill-and-keep shared-cost trunks are used for the delivery of transit traffic, the ILEC's transiting tariff must recover costs incurred for the additional capacity required for the transit traffic.

IV. CLEC Agreements for Transiting

23. Decision 97-8 requires that each LEC interconnect with every other LEC. The issue here concerns whether a LEC originating traffic can use transiting to terminate traffic to a second LEC in place of direct interconnection between the two LECs, without entering into an agreement with the second LEC to this effect.

24. Stentor stated that a CLEC choosing to use transiting service must enter into agreements with other CLECs. Stentor stated that two LECs would identify how they would interconnect in the various exchanges in which they provide service. Stentor considered that it would be inappropriate for a LEC originating traffic, that has chosen to utilize the transiting service of a given transiting service provider, to unilaterally impose its choice of transiting as a means of delivering traffic as well as its choice of the transiting service provider upon the terminating LEC.

25. The competitors considered that by virtue of the obligation imposed on LECs to interconnect with each other, a transiting LEC is bound to route all traffic received. If a CLEC purchases transiting services from an ILEC, the ILEC implicitly assumes the obligation of arranging for the delivery of all transited traffic delivered to it by the CLEC to the appropriate terminating networks. The competitors were of the view that a transiting service offered by the ILECs should not only eliminate the need for direct connections between each pair of CLECs, but should also relieve each CLEC taking advantage of the service from having to negotiate terms and co-ordinate the order process for transiting with every other CLEC that is accessible through an ILEC.

26. The Commission notes that in some cases, a CLEC may consider it effective to establish a direct route between itself and another CLEC rather than participating in transiting arrangements. Moreover, some CLECs may wish to obtain transiting services from service providers other than the ILECs. Each CLEC must be forewarned of a new CLEC offering traffic so that appropriate planning can be made for the provisioning of facilities. Accordingly, the Commission finds that each LEC must enter into an interconnection agreement with every other LEC to arrange the manner by which they plan to exchange traffic, whether by way of direct connection or transiting.

27. With regard to the competitors' view that once interconnection is established the ILEC must accept and route all traffic it receives, the Commission finds that the transiting ILEC must route only the traffic types that the ILEC and CLEC agree to transit: they must also agree on any new traffic types to be transited.

V. Trunk Group Requirements

28. This issue relates to whether all the traffic exchanged between an ILEC and a CLEC, including transiting traffic, can be carried on one trunk group and, if not, what type of trunk groups are required.

29. Parties agreed that transiting traffic for IXCs must be carried on a separate trunk group. This is necessary for technical reasons in that only the originating company can determine to which IXC an interexchange call must be routed.

30. Parties generally agreed that only one facility should be required between a pair of LECs, but there was some difference of opinion on the number of trunk groups that should be established.

31. The competitors described three alternatives for all local traffic:

(1) All local traffic may be carried over a common trunk group. Costs associated with transiting could be based on the relative percentage of traffic on a trunk.

(2) Segregate traffic based on intra-exchange ILEC traffic and other traffic (could include intra-exchange and intra-EAS transit and intra-EAS transport). A LEC choosing to so combine its traffic would pay the higher of the transit tariff or the EAS transport tariff on the combined traffic.

(3) Allow the LEC to segregate its traffic further into separate trunk groups.

32. The competitors considered the third option the least efficient solution in the early days of competition; however, as LECs gain market share, traffic volumes may warrant the use of this alternative.

33. The competitors favoured the first alternative because they considered this to be the most efficient.

34. The competitors considered it feasible to identify the various types of traffic and to develop arrangements for recovery of the costs associated with the various types. They allowed that when traffic volumes are large, it could be cost effective to use multiple trunk groups.

35. With the exception of TCI, the Stentor companies indicated they would be prepared to offer arrangements 2 and 3. Stentor submitted that the first alternative is not acceptable because tracking and recording of traffic information would be administratively cumbersome and result in increased cost as well as an overall loss of efficiency. TCI added that the competitors have provided no evidence that these procedures could be more cost-effective than simply installing separate trunk groups and billing according to trunk quantity.

36. TCI submitted that in order to measure and bill accurately for the services as mandated in Decision 97-8, four originating trunk groups are required: 1) bill-and-keep for local terminating traffic; 2) local transiting for all local transiting traffic; 3) EAS transport; and 4) IX transiting for all IXCs which use tandem access to the CLEC.

37. The competitors submitted that the transit traffic should be terminated on the bill-and-keep trunks. Stentor indicated that some companies might be prepared to do this, but not TCI, which is of the view that transiting traffic is better dealt with by routing it on the terminating carrier's own transiting trunk group.

38. Stentor and the competitors agree that toll traffic originated by a CLEC subscriber should not be delivered to the ILEC local tandem switch or be transited because these switch types do not support the Transit Network Selection parameter to select the correct IXC. These calls must be routed to an access tandem switch (toll switch).

39. The Commission considers that only one facility should be required between a pair of LECs and that it could carry multiple trunk groups.

40. The Commission finds it acceptable, in principle, for transiting traffic to be carried on a bill-and-keep trunk group. However, the Commission notes that although it would be desirable for all traffic to be carried over one trunk group, a means of identifying and measuring the various types of traffic must be available.

41. The Commission is of the view that the record does not demonstrate that methods are available to reliably identify and measure the traffic that is not to be exchanged on a bill-and-keep/shared-cost basis. However, where such methods are available, transiting traffic may be carried on the bill-and-keep trunk group, provided the cost of the trunking capacity required for the transiting is recovered in its entirety through the tariff (that is, no cost sharing with the originating or terminating CLECs).

42. Where such traffic measurement is not feasible, the Commission finds that the set of trunk groups to be used for the exchange of traffic between a CLEC and an ILEC providing transiting service to that CLEC must, at a minimum, be as follows:

(1) one trunk group (bill-and-keep shared-cost) for:

a) originating and terminating intra-exchange traffic between ILEC and CLEC subscribers and WSPs that are not CLECs; and

b) for an interim period, IXC traffic terminated on the ILEC using line-side arrangements;

(2) one trunk group (CLEC cost) for:

a) intra-exchange transit traffic; and

b) intra-EAS/EFRC transit traffic;

(3) one trunk group (IXC cost recovered through tariffs) required to terminate IXC to CLEC traffic; and

43. This issue concerns whether the scope of the mandated ILEC CCS7 transiting capability should accommodate CCS7 signalling messages which do not terminate at a signalling end point (e.g., database or end office) within the ILEC network (for example, non-call associated signalling messages).

44. Stentor considered that the definition of the scope of mandated CCS7 transiting should balance the objective of reducing the initial investment burden on CLECs with the objective of encouraging investment by competitors in CCS7 facilities. In Stentor's view, mandated transiting should be limited to the transit of CCS7 messages necessary to enable the implementation of transiting of traffic between switches. Stentor noted that some other CISC participants have already indicated their intention to offer CCS7 transiting services or to use CCS7 transiting services provided by other service providers. Stentor viewed this as evidence of the existence of alternative sources of supply.

45. The competitors submitted that there is no technical or operational basis for limiting the scope of the mandated ILEC CCS7 transiting capability. The competitors considered CCS7 transiting to be a service that carries signalling information when a pair of CLECs have direct trunks between themselves and also signalling to other end points for access to Intelligent Network/Advanced Intelligent Network/Local Number Portability (IN/AIN/LNP) databases and the provision of Custom Local Area Signalling Services (CLASS) services. The competitors considered that ILEC CCS7 transiting capability must accommodate the carriage of CCS7 traffic to signalling end points outside the ILEC network and that what Stentor is prepared to offer is not really transiting but simply the exchange of messages between the ILEC and the CLECs associated with transiting message traffic (voice calls). The competitors noted that ILECs have not denied that the ILEC CCS7 transiting capability can technically accommodate CCS7 messages that do not terminate at a signalling end point within the ILEC network.

46. The Commission considers that CCS7 transiting encompasses the use of the transiting company's CCS7 network to transport messages between signalling points outside of the transiting company's own network for the purpose of exchanging local traffic. For instance, it would support the transiting of CCS7 traffic between: a) CLECs in an exchange where they have implemented direct message trunking; b) a CLEC and an IXC; c) a CLEC and a WSP; and d) a CLEC and an LNP database.

47. It must also be noted that the Commission ordered Stentor to provide access to its LNP service control point (SCP). As a consequence, transiting will also have to contemplate carriage of CCS7 messages between Stentor companies for specified purposes.

48. Accordingly, the Commission finds that the ILEC transiting service must permit the exchange of CCS7 messages between CLECs and between a CLEC and a WSP operating in an exchange, between a CLEC and IXCs and between a CLEC and the Stentor LNP SCP(s).

VII. CCS7 Signalling Connection Control Part (SCCP) Capability

49. This issue concerns whether the mandated ILEC CCS7 transiting function should provide for a Signalling Connection Control Part (SCCP) capability in addition to the Message Transfer Part (MTP) routing capability. The SCCP capability provides the ability for addressing special messages. SCCP messages may be used to provide a variety of services in a network, some of which may be related to the exchange of traffic between a pair of carriers, including the provision of optional services.

50. Stentor submitted that such CCS7 messages can be transited without the use of SCCP capabilities.

51. The competitors considered that the scope of the mandated ILEC CCS7 transiting capability should include a SCCP routing capability in addition to a MTP routing capability. The competitors submitted that the greatest possible use of CCS7 connectivity should be supported between LECs via the mandated ILEC CCS7 transiting function.

52. The competitors noted that it is unclear as to how IN/AIN/CLASS services would be supported in an efficient manner in the context of an LNP environment unless the ILEC transiting capability could accommodate for a SCCP routing capability.

53. Stentor submitted that if the Commission determines that SCCP routing is to be included in the mandated CCS7 transiting service to be offered by the ILECs, the mandate to provide CCS7 transiting service should only include intermediate Global Title Translation (GTT) for CCS7 messages which are sent to the terminating CLEC via D-links (D-links are the circuits between signalling transfer points (STPs)). The final GTT function should remain with the terminating CLEC in these configurations, because to perform this function within the ILEC's transiting network would require that the CLEC provide the ILEC with complete information about all its internal CCS7 point codes.

54. Parties agreed that transiting of messages to some end points will require the SCCP capability. Parties also agreed that this can be done in at least two ways, one whereby the transiting company takes on full responsibility and a second where the terminating company shares some of the responsibility. In the case where the originating CLEC has access to an STP, the transiting company can provide the complete processing or an intermediate form of processing that would be adequate to route the message to a terminating network. Additional processing to route the message to the appropriate end point would be required at the terminating network.

55. The Commission finds that the mandated ILEC CCS7 transiting function must provide for the transiting of SCCP messages in order to ensure that subscribers can benefit from the full range of basic, optional and enhanced services that can be provided between local carriers exchanging local traffic.

56. The Commission finds that the carrier originating the SCCP message must be responsible for the GTT and must make arrangements for the processing necessary to route the message to the terminating network.

VIII. Non-ILEC Transiting - Switching and Aggregation Charge

57. This issue deals with determining who is entitled to the switching and aggregation (S & A) revenue in a case where a LEC performs a transiting function between an IXC and other LECs.

58. The competitors were of the view that the LEC offering the transiting service should be entitled to the S & A revenue and that it should also be responsible for ensuring that contribution is collected and remitted. The competitors also noted that the CLEC could terminate IXC traffic on a line-side basis (as can an ILEC) and avoid paying the S & A charge.

59. In its reply, Stentor stated that this configuration is complex and that additional arrangements may be required. Stentor also stated that traffic could only be delivered this way where the parties agree.

60. Consistent with its earlier findings, the Commission finds that the company providing the transiting service is entitled to recover the transiting costs incurred by way of a tariff or other arrangement. The company whose customer originates the IX traffic or receives IX traffic is entitled to the revenue from the S & A charge.

IX. Treatment of Transiting Traffic Between a WSP and a CLEC

61 This issue concerns the treatment of LEC/WSP traffic where the WSP is a customer of a LEC and is not a CLEC.

62. The Commission notes that all parties agreed that in the case of WSP to CLEC traffic, the WSP traffic would apply and that terminating traffic would be carried over the bill-and-keep trunks.

63. The Commission finds that a WSP's traffic must be treated as would the traffic of a retail subscriber of the LEC to which it is connected. Accordingly, the traffic must be transported on the bill-and-keep trunks between the LEC with which the WSP is connected and the originating or terminating LEC.

X. Transiting and Independent Companies

64. This issue relates to whether ILEC transiting service mandated by the Commission in Decision 97-8 includes the delivery of traffic to an independent company in cases where the independent company exchange is within the ILEC's EAS/EFRC area.

65. The competitors stated that independent telephone companies are not CLECs and that this situation is similar to EAS/EFRC transiting. With the exception of TCI, the Stentor companies took the position that while Decision 97-8 does not mandate the delivery of traffic to independent companies as part of the transiting service in such cases, they are nonetheless prepared to do so.

66. TCI stated that transiting to independents is inappropriate given that it would require that the regulator mandate competitive entry into the independent telco's territory.

67. Contrary to TCI's view, the Commission does not consider it necessary to mandate competitive entry into the independent telco's territory in order to permit the transit of traffic between a CLEC and an independent. Transiting will enable a CLEC subscriber to call a subscriber of an independent telephone company and vice-versa: transiting will not enable the CLEC to provide service in the independent company's territory.

68. The Commission finds that transiting between CLECs and independents within the EAS/EFRC area of an ILEC is to be treated in the same manner as transited traffic between CLECs within the company's own EAS/EFRC area.

69. The Commission orders that LEC transiting services be provided in accordance with all of the determinations in part A of this Order.

PART B - POINTS OF INTERCONNECTION

70. Members of the NPSG of the CISC have not been able to reach a consensus on a number of issues related to POIs between LECs. Also, in a letter dated 15 September 1997, MetroNet requested that the Commission permit CLECs to use third party STPs that are already connected to the Stentor CCS7 network on a D-link basis. It also requested that the use of these links be extended to the exchange of CCS7 messages between ILECs and CLECs that provide services in multiple locations.

71. Comments were received from Stentor on behalf of BC TEL, Bell, Island Tel, MT&T, MTS, NBTel, NewTel, and TCI and from the competitors. Reply comments were received from the competitors and Stentor.

72. The Commission notes that although certain provisions regarding POIs are mandated, parties are free to negotiate arrangements that they may consider more advantageous.

I. Use of a Wireless Service Provider's Terminations When the WSP Becomes a CLEC

73. This issue relates to how the interconnection and related services (tandeming, transiting and EAS/EFRC transport) that an ILEC provides to a WSP pursuant to current tariffs should be treated when the WSP becomes a CLEC. That is, should the use of the existing terminations and switches continue to be used in circumstances where a WSP becomes a CLEC and subscribes to various ILEC transiting and transport services made available pursuant to Decision 97-8, or should the WSP be required to abandon current interconnection facilities and conform to the network structure requirements of Decision 97-8.

74. The competitors considered that there are no operational or technological impediments with respect to the continued use of existing arrangements. They were of the view that, subject to any overriding technical or capacity limitations, the use of existing facilities should be permitted. They stated that certain WSPs deployed various interconnection arrangements at very substantial capital and operational costs. They merely seek to continue using these resources for the exchange of local traffic in a competitive environment.

75. Stentor considered that where existing facilities are sufficient and terminate at the ILEC POI, they should be used as the transmission facilities for interconnection. Stentor stated that in some instances, the continued use of existing WSP terminations on an ILEC switch may be mutually beneficial to the parties involved. Stentor considered that in Decision 97-8 the Commission clearly stated that parties could adopt alternative arrangements where they found it mutually beneficial to do so. Stentor submitted that alternate WSP/ILEC interconnections could be negotiated and that the outcome should not be mandated by the Commission.

76. The competitors were of the view that regardless of the selection criteria for ILEC POIs, existing interconnection arrangements should be grandfathered if the facilities can technically provide for the exchange of traffic. Some segments of the existing facilities could be utilized in order to establish a new interconnection arrangement from the pre-existing WSP POI to the ILEC Gateway POI. Any transmission capacity available for some portion of the existing facility could be utilized to establish an additional interconnection arrangement with a third service provider. Existing interconnection facilities would not be contemplated if forecasted traffic flows would result in the exhaust of the underlying network.

77. The competitors were concerned that adopting the Stentor position would result in the imposition of: (1) significant stranded investment for WSPs and IXCs associated with the abandonment of existing facilities; and (2) new costs of building interconnection facilities to ILEC POIs.

78. The Commission notes that the current tariff arrangements provide WSPs with the equivalent to CLEC interconnection, EAS/EFRC transport, EAS/EFRC transit and IXC (not equal access) transit services. These services are acquired through interconnections at ILEC central offices that may not be POIs for ILEC/CLEC interconnection under the terms of Decision 97-8. Further, the WSPs have acquired interconnection facilities through the use of tariffs for which they may have incurred significant initial costs and perhaps signed multi-year contracts. If the WSPs are not able to retain those arrangements when they become CLECs, the associated facilities will have to be abandoned, potentially resulting in significant loss. It may also be that a WSP has established a point of presence near the ILEC office with which it is interconnected and that costs would be increased if the ILEC's Gateway POI is at a different location.

79. In Decision 97-8, paragraph 27, the Commission stated:

"To minimize a LEC's costs, the Commission mandates the equal sharing of the costs of interconnecting trunks and CCS7 signaling links. The Commission considers that this approach will assist in promoting competitive equity and efficiency of interconnection by reducing or eliminating any incentive to impose on competitors higher than necessary costs for interconnection facilities."

80. In paragraph 33 of Decision 97-8, the Commission considered that with the exception of gateway connections, the possibility of other arrangements should not be precluded. The Commission notes that all parties to this dispute agreed to negotiate alternative arrangements. The competitors asked for some guiding principles to help in accelerating the bilateral negotiations.

81. While the Commission agrees that negotiating alternative arrangements should generally be permitted, it considers that the use of existing facilities should be maximized to the extent technically and economically feasible. Where the facilities used by the WSP meet the necessary technical requirements, have adequate capacity and terminate at the designated ILEC POI, they should be reused for the current term of the arrangement. As set out below, the existing arrangements should be converted to the extent necessary to conform with the arrangements contemplated in Decision 97-8. Additional facilities required should be provided pursuant to the Decision 97-8 criteria.

82. The Commission finds that where the ILEC Gateway POI and the existing ILEC's WSP POI are at the same location, existing facilities are to be used and the ILEC is to be responsible for its share of the cost for trunking used for bill-and-keep traffic. Where the ILEC Gateway POI and the ILEC's WSP POI are not at the same location, and the existing facilities are appropriate and adequate for WSP/CLEC to ILEC interconnection, the existing facilities should be used. The WSP/CLEC shall be responsible for the cost of the existing facilities between the ILEC and itself and the ILEC shall be responsible for costs of the facilities between the existing ILEC's WSP POI and the ILEC Gateway POI designated pursuant to Decision 97-8. These arrangements may be used only for the duration of the current term of the existing arrangement for the provision of the facilities.

II. Location of Signalling Points of Interconnection

83. This issue is related to the location of the Signalling Points of Interconnection (SPOIs).

84. Stentor considered that the decision regarding the location of a SPOI should be made on a case-by-case basis. Stentor noted that the network planning and design considerations for signalling and message exchange networks are different.

85. The competitors considered that SPOIs should be selected from the set of POIs. They noted that signalling and circuit-switched networks are parallel networks and that switching elements and transmission facilities which comprise the CCS7 network have been deployed in the same central office as the circuit-switched network.

86. The Commission notes that a list of POI and SPOI locations was provided by Stentor companies. Stentor provided some examples where a POI and SPOI are in the same location and one example where the SPOI had to be in a different location from the POI because of capacity limitations.

87. The Commission finds it appropriate to mandate the co-location of POIs and SPOIs because it is likely to be more efficient from the perspective of facilities planning and provisioning. Accordingly, the Commission requires that every SPOI be co-located at a LEC's designated POI.

III. CCS7 Interconnection Principles

88. Decision 97-8 requires that each CLEC make provision for interconnection to its CCS7 network in each numbering plan area (NPA). The interconnection of CCS7 networks actually entails the interconnection of pairs of STPs, either directly or through pairs of SPOIs. When two companies both operate in the same set of NPAs, the number of CCS7 interconnections between them is greater than is necessary to handle the CCS7 traffic. It would be sufficient technically to have only one set of interconnections between a pair of LECs.

89. Parties agreed that an appropriate interpretation of the Commission's determination at paragraph 40 of Decision 97-8 is that the ruling would allow for more efficient forms of CCS7 interconnection among large-scale (multiple NPA) or national LECs. However, Stentor stated that Decision 97-8 addressed the issue and, unless parties agree on alternative arrangements, parties should provide one SPOI per NPA. The competitors were of the view that additional principles of interconnection are required to allow LECs serving more than one NPA to interconnect using one SPOI.

90. In paragraph 40 of Decision 97-8, the Commission mandated LECs to provide one SPOI in each NPA they serve. The Commission requested CISC to provide recommendations concerning the location of SPOIs.

91. In the particular case where two LECs both provide services in more than one NPA, the competitors were of the view that each LEC should provide one SPOI in each NPA and that a pair of interconnections should not be required in each NPA. The Commission notes that Stentor indicated that one arrangement whereby a multiple NPA LEC will interconnect with an ILEC in a single NPA, has already been established through mutual agreement.

92. The Commission notes that where a pair of LECs both operate in the same set of NPAs, one signalling interconnection between the LECs is usually sufficient for the interexchange of CCS7 messages related to the exchange of local and EAS/EFRC transport and transiting traffic in those NPAs.

93. Accordingly, the Commission finds that where two LECs both operate in the same set of NPAs, a separate SPOI in each NPA is not required provided that the CCS7 interconnections between them meet the CCS7 standard requirements. However, when a LEC operates only in one NPA, other LECs operating in that NPA are required to provide a SPOI in that NPA unless other arrangements are made for interconnection.

IV. Treatment of Existing CCS7 Interconnections When a WSP Becomes a CLEC and an IXC Begins to Operate as a CLEC

94. WSPs (cellular and Personal Communications Services (PCS)) and IXCs currently have CCS7 interconnection with the ILECs. The issue here is whether or not there should be a presumption that existing interconnection arrangements should continue to be utilized in the local exchange environment.

95. Stentor stated that, depending on the nature of the arrangements which now exist, when a WSP or an IXC becomes a CLEC, it may or may not be necessary in any particular case to modify the existing CCS7 interconnection arrangements. Stentor reiterated that when a WSP (or an IXC) becomes a CLEC, it should conform to the principles established in Decision 97-8, including those governing CCS7 interconnection.

96. The competitors were of the view that existing CCS7 interconnection arrangements, for both WSPs and IXCs, should be grandfathered. They considered that the use of existing arrangements is fully consistent with the policy objectives pertaining to network efficiency as well as mitigating the barriers to entry. Competitors stated that the Stentor CCS7 network should be considered as one aggregate network. The competitors stated that since Stentor Canadian Network Management provides for a single CCS7 interconnection arrangement for IXCs, there is no operational or technical reason why it should be precluded for CLECs.

97. The Commission notes that the Stentor companies have established agreements for interconnection and revenue sharing for inter-company toll services which allow for the provision, by their member companies, of national services. The agreements necessitate the interconnection of their CCS7 networks. IXC competitors have been able to establish one connection to the Stentor companies' CCS7 networks to deliver national services.

98. The existing arrangements for WSP/ILEC CCS7 interconnection may also require only one set of interconnections with a Stentor member company for the exchange of traffic with all Stentor companies. The Commission notes that this arrangement is efficient and appropriate where the WSP seeks to interconnect with all Stentor companies in order to be able to operate on a national basis.

99. The Commission considers, however, that where an IXC or WSP operates as a CLEC, in a given NPA, the IXC or WSP will operate as a CLEC co-carrier and the provisions of Decision 97-8 requiring it to establish a SPOI in the NPA, as interpreted above, apply.

V. Interconnection of ILEC and Third Party CCS7 Networks

100. This issue addresses the feasibility and nature of the interconnection of the ILEC CCS7 network and the CCS7 network of a party providing CCS7 services to a CLEC or CLECs.

101. The competitors submitted that ILECs should be required, on demand, to implement CCS7 interconnection with a CLEC through the SPOI of a third party. The competitors submitted that by using a third party's STP, a CLEC will be able to support its signalling needs without having to deploy its own STPs on the day it begins to operate.

102. Stentor submitted that the principles of Decision 97-8 do not apply to the interconnection between a third party CCS7 service provider used by a CLEC and the ILEC.

103. The Commission notes that, in Decision 97-8, it did not preclude the use by a CLEC of a third party's SPOI. Thus, when a CLEC uses the network of a third party for the provision of signalling transmission and switching services, the Commission considers that SPOI provided by the third party should be considered as being the CLEC's designated SPOI for purposes of Decision 97-8. Further, if several LECs decide to have common SPOIs, these SPOIs should be considered as the SPOIs of each individual company. The CLECs could also decide to use only one set of links to other LECs and share the cost.

VI. Establishment of SPOIs When a New NPA is Established

104. A new NPA has to be established when the numbering plan for that NPA is close to exhausting the central office codes (NXXs) available. New NPAs may be established in a number of ways such as splitting a region or using an overlay. When splitting the region, the area covered by an old NPA is split in two, one part retains the old number and the other part is given a new number. When the overlay method is used, a second code is given to the area and henceforth ten digits must be dialed for all local calls. The issue here is when a new NPA is established, does Decision 97-8 require that a new pair of SPOIs be established?

105. In the case of an NPA overlay scenario, parties agreed that the existing SPOI should be used for both NPAs. However, on the issue of an NPA-split scenario, Stentor stated that each LEC should provide a SPOI in both the old and new NPAs. The competitors maintained that the pre-exhaust interconnection arrangement should be maintained because it is adequate.

106. The Commission notes that, in Decision 97-8, it mandated each LEC to have one SPOI per NPA to allow for more efficient and less expensive interconnection arrangements for regional CLECs. In the particular case of an overlay scenario where the new NPA will cover the identical geographical area served by the old NPA, the Commission agrees with parties that in this case, no new SPOI should be required.

107. In the case of an NPA-split, the Commission finds that the principles established in Decision 97-8, as interpreted above, require that LECs operating in both NPAs must establish a new SPOI to connect with a LEC that might be operating only in the old or the new NPA, unless other arrangements can be negotiated.

VII. Cost Sharing of A-Links

108. This issue addresses the situation where a new LEC does not have an STP and uses the ILEC STP by way of an A-link connection between its local switch and the ILEC STP. An A-link is a CCS7 signalling link between a switch and an STP.

109. The competitors submitted that symmetrical cost sharing should apply to A-links. They were also of the view that there are no functional differences between A-links and D-links and that both provide for the requisite level of CSS7 connectivity between peer networks. The competitors also were of the view that if a regional CLEC requires a single switch or a small number of local switches, it is neither efficient nor economical to deploy an STP. The competitors concluded that A-links would provide for the most efficient form of interconnection between networks and that the costs of the links should be shared.

110. Stentor noted that A-links are provided under tariff and that only D-links are the type of connections referenced by Decision 97-8. Stentor did not consider an A-link interconnection equivalent to a D-link interconnection since the A-link originates in the local switch and the local switch does not do any routing as would an STP. Also, the local switch originates or acts on CCS7 messages whereas the STP simply routes messages. The local A-link between a local switch and an STP was not considered a peer-to-peer relationship; therefore, costs of
the links should not be shared as are links between co-carriers.

111. The Commission finds that D-links would provide for the most efficient form of CCS7 interconnection. The Commission also finds that an A-link between a local switch and an STP is not a peer-to-peer relationship. The Commission notes that under Decision 97-8, A-links are provided under tariff.

112. Accordingly, the Commission finds that A-links are not subject to cost sharing.

VIII. Cost Sharing of Unbundled CCS7 Elements

113. The competitors were of the view that costs of establishing CCS7 interconnection arrangements (such as the provision of signalling link cards, use of transmission facilities, CCS7 cross-connects, one time service and/or administration activities relating to the engineering, planning, operations, translations, and testing activities associated with initial connection of CCS7 networks or any subsequent modification to given CCS7 interconnection arrangements) should be borne by the carrier incurring the costs. The competitors argued that tariffs for the services associated with CCS7 interconnection are unnecessary and unwarranted.

114. Stentor responded that Decision 97-8 specified the facilities which must be provisioned on a shared-cost basis, and that other facilities would in general be provided under tariff or on the basis of bilaterally negotiated agreements.

115. The Commission considers that tariff rates for any CCS7 service provided by the ILECs should be examined in the context of a tariff filing.

116. The Commission hereby orders that:

(1) Existing ILEC and WSP interconnection facilities including CCS7 be used in accordance with the determinations set out above;

(2) SPOIs be co-located and established as set out above;

(3) CCS7 interconnections be established in accordance with the determinations set out above; and

(4) A-links between CLEC switches and ILEC STPs not be subject to cost sharing.